[manaox2]

It still sounds like it could be good news as long is it doesn't keep you from attending as many meets or having good gear.

I want to know about the new job too!

 

[mbriant]

From today's Financial Post newspaper:

Founders aren't always the best CEOs

Ironically, the Financial Post is the business section of The National Post .... founded by, but no longer controlled by, former media mogul Conrad Black who is presently serving a 78 month prison sentence in the U.S.

http://en.wikipedia.org/wiki/Conrad_Black

 

[Lamenthe]

Quote:

Originally Posted by mbriant /img/forum/go_quote.gif From today's Financial Post newspaper: Founders aren't always the best CEOs

That was a good read. Thanks for the link. (Business School student here)

On the thread, so far it sounds like a mixed bag for Tyll (thus the semi-literal/ironic title?). I'm hoping there's more good than bad in the end though. Not being CEO isn't exactly a bad thing, it'll free up time and allow you to concentrate on what you're best at or enjoy the most.

 

[Canman]

Quote:

Originally Posted by Tyll Hertsens /img/forum/go_quote.gif So, there was this board meeting (I'm on the board with 3 others) where a unanimous vote was cast for a new CEO at HeadRoom.

Tyll, I'm sure its bittersweet giving up control of your baby even if you will be able to more of what you love! I think I recall you mentioning that Headroom had received venture funding which would explain that 5x growth requirement. That has some major implications for the company you created, and it looks like there will be major change very soon.

In order to grow enough to pay back the fund investors, Headroom will have to gain greater mass market appeal. Thats probably where the portable line comes in and who knows, hopefully we will see some Headroom branded headphones!

I think that headphone audio is the only bright spot in the broader high end audio market because younger people can associate with headphone audio through ipods and computers. It is also the result of the decline in the retail distribution channel (in favor of online research and purchasing) and the elitism associated with high end audio dealers. I think that Headroom is well positioned to take advantage of these trends.

I hope you don't mind a few suggestions for Headroom as it grows: Don't forget the community that exists in large numbers because of you! The Head-Fi community benefits greatly from your presence and I think the company does too. The connection to the community may become more difficult as Headroom grows but I think it is integral to long term success. Number two, the industrial design needs to improve in order to gain mass market appeal and support higher selling points. The current designs are quirky and cheapen the perception of the brand. Create a case design that lives up to the coolness of your logo! Number three, I think the product lines have always been a bit confusing and they are not well differentiated from each other. They overlap and the consumer is unclear, for example, what differences there are between an ultra micro and ultra desktop. Additionally, the power supply options are confusing and in my opinion decrease the perception of value. Why can't my Ultra desktop come with an internal supply and look cool when it costs the same as my Grace m902? Number four, it may seem like a good idea, but don't get in to the shirt business.

I wish you the best of luck in your new role!

 

[manaox2]

Quote:

Originally Posted by Canman /img/forum/go_quote.gif Number four, it may seem like a good idea, but don't get in to the shirt business. I wish you the best of luck in your new role!

Too late.

HeadRoom Gear - HeadRoom - Right Between Your Ears

At least they aren't tropical themed and look quite nice to me.

 

[erikzen]

I'm glad I came in at the end of this story. If I had seen this thread a few days back I'd have probably been climbing the walls.

I'm happy/sad to hear about Tyll's new job. We've all grown to know and love you as the head of that headphone geek company. You can be very proud of what you've done - not only build a business but an entire industry.

It's a classic case study though. Entrepreneurs rarely make good CEOs. You probably could be an excellent CEO, Tyll, but as you say it's not your passion.

So there are two stories here, intertwined as they may be.

To me, this is the most telling post so far, other than the disclosure that Tyll will have a new boss.

Quote:

Originally Posted by Tyll Hertsens /img/forum/go_quote.gif The Good: HeadRoom has an amazingly strong position in its market. All payables, customer refunds, bank loans are current. Website traffic is stellar. Product is excellent and doesn't come back broke. The Bad Payroll is too big. Manufacturing isn't efficient enough. Too much inventory, not enough cash in the bank. Not enough growth into broader markets The Ugly Sales are 30% down, without much hope for an upturn. The company is far from sustainable with those numbers.

The strategy here is maximize the good, offset or eliminate the bad, and turn the ugly into something you can live with.

So you keep doing what you're doing on the good list and improve on it. From what little I know I would say Tyll probably had a large hand in all of those successes, although he probably won't admit it. Still, this is about his dream job and as Jahn says, head of marketing and R&D would fit the bill.

On the bad side...

Payroll is too big, heads gotta roll, salary and hiring freeze, benefits get scaled back, jobs get shuffled, new org chart. Sad but true.

Manufacturing isn't efficient, you either outsource/offshore, or invest in retooling and hiring someone with a ton of operations experience. The latter seems like a big investment at such a time so it's probably the former. Unless there is a merger...

Too much inventory, tough one but you got to sell what you got for whatever you can get. Look for sales of existing inventory.

Not enough growth into broader markets, look for new product lines, some that are not headphone-centric, like the desktop audio system. Possible foreign expansion as well.

That's my take, anyway.

 

[analogbox]

Man, it's just painful to hear.

 

[Tyll Hertsens]

Quote:

Originally Posted by analogbox /img/forum/go_quote.gif Man, it's just painful to hear.

Yeah.

Listen, I gotta go run some errands and do a meeting, be back later.

 

[spt1224]

Quote:

Originally Posted by Tyll Hertsens /img/forum/go_quote.gif * Too much inventory, not enough cash in the bank. * Not enough growth into broader markets

I have several ideas rolling around in my head that would help offset these problems if executed well, so I thought I'd mention them before they drive me crazy.

MP3 Players

1. Option 1: Build an MP3 player design directly into a mobile amp/DAC such as the BitHead or a new design. I'm sure you could buy a design off of someone or partner with them. Unlike most MP3 players on the market, yours would obviously have the amp circuitry as a highest priority. Probably simplest to make the device act as a USB mass storage device, which means no unnecessary software design. Flash storage has steadily continued to become much smaller, much cheaper, and much larger in capacity, so that wouldn't be an issue.
2. Option 2: Become a retailer of some or all of the most popular MP3 player brands: Apple, Creative, and Microsoft. Might be the best option to start, since there would be no new R&D involved.
3. Being able to sell MP3 players would allow you to bundle them with headphones and be able to market to more than just us crazy audiophiles.

Miscellaneous

1. Start providing video reviews of the products you sell. Some people like to see and hear about, rather than just read about, what they're buying before they pull out their wallets.
2. Start selling some of your products through other retailers - Amazon, Newegg, etc. Just put enough on those sites to get people interested in your products and hopefully clear out some of your extra stock. Include advertising in the packaging of products distributed through these other sites without making it look like junk mail people would throw out, and hopefully some people will take interest in your website and other products.
3. Provide people with a marketplace to sell their used headphones, etc., on your site. Charge them a small fee for the service to help generate some extra cash.

 

[madmax7]

Man, I hope this works out for the best. I don't know Tyll personally, but he seems like a good dude. Good things need to happen to good people.

 

[Lamenthe]

Quote:

Originally Posted by spt1224 /img/forum/go_quote.gif I have several ideas rolling around in my head that would help offset these problems if executed well, so I thought I'd mention them before they drive me crazy. MP3 Players Option 1: Build an MP3 player design directly into a mobile amp/DAC such as the BitHead or a new design. I'm sure you could buy a design off of someone or partner with them. Unlike most MP3 players on the market, yours would obviously have the amp circuitry as a highest priority. Probably simplest to make the device act as a USB mass storage device, which means no unnecessary software design. Flash storage has steadily continued to become much smaller, much cheaper, and much larger in capacity, so that wouldn't be an issue. Option 2: Become a retailer of some or all of the most popular MP3 player brands: Apple, Creative, and Microsoft. Might be the best option to start, since there would be no new R&D involved. Being able to sell MP3 players would allow you to bundle them with headphones and be able to market to more than just us crazy audiophiles. Miscellaneous Start providing video reviews of the products you sell. Some people like to see and hear about, rather than just read about, what they're buying before they pull out their wallets. Start selling some of your products through other retailers - Amazon, Newegg, etc. Just put enough on those sites to get people interested in your products and hopefully clear out some of your extra stock. Include advertising in the packaging of products distributed through these other sites without making it look like junk mail people would throw out, and hopefully some people will take interest in your website and other products. Provide people with a marketplace to sell their used headphones, etc., on your site. Charge them a small fee for the service to help generate some extra cash.

On MP3 players:
I agree with you that there is some merit in selling more audio retail products like iPods, etc. It'll help bring in a new customer base if done properly. The problem is, it's rather risky since you would have to increase inventory first before even making a single potential sale. Overall I think you make a great point.

On Miscellaneous:
I'm going to have to disagree with you here. Video reviews take a lot of time and energy that they don't have.

If they start selling their products on other sites like Amazon, they are only serving to dilute their current customer base. Not only that, they will lose the capability to control their product prices. Corporations (especially retail companies) want consumers to go to their website, not others (even if it means forgoing extra press).

Finally, there are already plenty of well established market places for used headphone gear or any electronics in general (e.g. head-fi, eBay, etc). Why compete when you can't win?

Anyways I'm just a lowly business school student; I simply wanted to illustrate that despite our good intentions, our knowledge is severely lacking to help make LARGE improvements for HeadRoom.

They have far more qualified individuals to figure out how offset said problems.

 

[spt1224]

Quote:

Originally Posted by Lamenthe /img/forum/go_quote.gif I'm going to have to disagree with you here. Video reviews take a lot of time and energy that they don't have.

Not really... they don't need to be fancy, and there doesn't need to be one for every single product they sell. Just set up a camera, turn it on, talk about the product, and upload. Someone could easily do one or two products a week until there's a review for all of the most popular products. Plus, it helps that the reviews are already done in written form.

Quote:

Originally Posted by Lamenthe /img/forum/go_quote.gif If they start selling their products on other sites like Amazon, they are only serving to dilute their current customer base. Not only that, they will lose the capability to control their product prices. Corporations (especially retail companies) want consumers to go to their website, not others (even if it means forgoing extra press).

I was thinking Amazon Marketplace, mostly, and any other sites like that which give the sellers lots of control over their products. Amazon's customer base is so massive, I think going on there would be much more likely to help a business' sales than hinder them. As mentioned, existing stock isn't going to make any money sitting in a warehouse.

Quote:

Originally Posted by Lamenthe /img/forum/go_quote.gif Finally, there are already plenty of well established market places for used headphone gear or any electronics in general (e.g. head-fi, eBay, etc). Why compete when you can't win?

Agreed. That was just a thought that popped into my mind as I was typing the rest.

Small improvements are better than no improvements. Leave the big improvements to their experts, but every little bit helps

 

[Tyll Hertsens]

An interim executive team is assigned.

The gavel hits the table.

And I'm not the CEO anymore.

The business coach pulls me aside ... he wants to talk.

We go into my office.

He closes the door behind us.

"How you doing?" he says.

...sigh ... "It is what it is, I am where I am. What do I do now?"

"That's the good news," he says, "you get your dream job."

He starts telling me that in business coach training they use the story of Steve Jobs at Apple.

First, Steve eats Wozniak for breakfast.
This is a hardball game and Steve needed to warm up.

Then Steve grows the company like a genius 'cuz he gets the gadget and makes it glow,
and is smart enough to do the rest adequately.

Time goes on. Steve gets good at a variety of things, and the company's running just fine, thank you very much.

But after a while Steve's runnin' his butt off and not really doing any one thing well,
not even the stuff he's good .... no, genius at. The company starts to falter.

So they kick Jobs out and hired Scully, a guy that knew how to make a money machine.
Scully was even good at managing marketing departments that understood branding and product differentiation and stuff.

But he didn't know how to make the juice appear in the gadget.
Apple began to lapse into a semi coma of self satisfaction and denial.

Meanwhile, Jobs went back to the begining at Next and failed, but learned a lot in the process.

Then, the hidden in the background, but ever so powerful, owners reached in and placed Jobs back in charge,
and with his new found appreciation of how hard it is to administer and operate a company,
he started doing what he was good at (product and marketing) and got good money machine guys turn the crank.

Baddabing, the iPod.

Steve couldn't have done it from the beginning,
he needed to learn the lessons of getting kicked out.
And he's one in a billion, anyway.

He went on to say that the successful company after founder's trap,
is the one that balances a visionary founder with a money-machine-maker CEO. Success is when the visionary provides the CEO with solid intellegence and golden opportunities; where the founder lives by the budget, and where the CEO knows how to budget the money and forbearance needed to solve the problems that capitalizing on opportunity inevitable bring.

I began to feel a weight lifting off my shoulders.

"But wait," says I, "did you tell me what my dream job was in there?"

"No." he shakes his head, "You have to tell me what your dream job is."

Then he points to the pad and paper.

"Write it down."

I give him a quizzical look.

"Now."

 

[Lamenthe]

Quote:

Originally Posted by spt1224 /img/forum/go_quote.gif Not really... they don't need to be fancy, and there doesn't need to be one for every single product they sell. Just set up a camera, turn it on, talk about the product, and upload. Someone could easily do one or two products a week until there's a review for all of the most popular products. Plus, it helps that the reviews are already done in written form. I was thinking Amazon Marketplace, mostly, and any other sites like that which give the sellers lots of control over their products. Amazon's customer base is so massive, I think going on there would be much more likely to help a business' sales than hinder them. As mentioned, existing stock isn't going to make any money sitting in a warehouse. Agreed. That was just a thought that popped into my mind as I was typing the rest. Small improvements are better than no improvements. Leave the big improvements to their experts, but every little bit helps

I respect your arguments defending your points. I think we are just looking from two different perspectives: you being the optimist and me being the pessimist (I like playing devil's advocate

)

And I agree that small improvements are better than nothing. I hope Tyll's story gets a happy ending.

edit: oh snap. posted this just as Tyll posted his finale (?). As it is now, sounds like quite the ending

. The title of the thread serves the story well... now just to hear what exactly your Dream job is!

edit 2: Hope you don't mind, but I think I'm going to have to share that amazing little Steve Jobs anecdote later.

 

[madmax7]

Man, an audiophile DAP would kick some major tail, no? HeadroomPod.

I'm in!